We here at the North Carolina Professional Association of Nannies have chosen to #SignalBoost this INA Sponsored Message by GTM because we are signatories to the Fair and Legal Pay Pledge and so feel it is our solemn duty to promulgate legal pay information. We hope this is of use to those paid through online apps.
Nannies – if your employer pays you at least $600 a year through an online app, such as Venmo or PayPal, those platforms are now required to report the income to the IRS. In these cases, the employers will receive a 1099-K form to report the taxes.
This rule went into effect on January 1, 2022, so the personal tax returns due in April will not be affected. 1099-K forms (Payment Card and Third-Party Network Transactions) for the 2022 tax year will be sent to employers early next year.
We strongly advise against families using online apps to pay their nannies. Paying via these platforms leads to a misclassification of their nanny, as 1099 forms apply to independent contractors, not employees. In almost every case, a nanny is considered an employee and requires a W-2 form for tax purposes, not a 1099.
In addition, several states require employers to issue pay stubs that provide details like hours worked, pay rate, overtime hours, paid time off, and more. Paying you with a mobile app and potentially skipping a paystub would put your family in noncompliance with labor laws.
Get more details about this new tax reporting rule.
Using a reputable payroll provider like GTM helps families avoid misclassifying their nanny and other labor law missteps. We’ll ensure they’re paying you the right way.
If you’re a nanny that knows a family that could use GTM’s nanny tax and payroll service, send them our way. If they sign up with us, you’ll get a $75 Amazon gift card! Just fill out this form.
Visit us at GTM.com/household, or call (800) 929-9213 to learn more about our nanny payroll and tax services.
